Consumer Hacks

Hey guys, check out the brand spanking new site Consumer Hacks. You'll find great tips on new technology, gadgets, career news and just some general hacks to get through life.

Exchange Ingredients is back

Hi guys, sorry for the long absence but exchange ingredients is back and running full time. We're excited to be back so check back for further updates.

Attractive people make more money?

I came across an article called attractive people earn more money and I knew I had to read it. It's quite interesting. According to CNN Money, the good looking, slim, tall people tend to make an average of 5 percent more an hour than the average Joe/Sally.

"For example, the study found there was a higher beauty premium among private sector lawyers than their government-supported counterparts since private attorneys need to attract and keep clients. "

It also said that women who were considered obese in terms of their BMI (body mass index) earned 17 percent less than women within their recommended BMI range.

Sad to say but I think all this is true, especially in college life where job interviews and on campus career fairs are being taken place. If you've the following characteristics:

• Tall
• Slim/built
• Good looking
• Powerful voice

then you're more likely to get picked for that interview. I've noticed many of my friends who were obese and friends who were not and more attractive, with the same credentials go into career fairs and the only ones who came out with an interview were the more attractive ones.

Links around the corner

Here are some good finance articles I came across today, check em out:

1. Stop overspending now, 14 ways to conquer binge buying


2. Three purchases that will ultimately save you money


3. Go open a roth Ira right now


4. Ten lowcost ways to reduce money stress


5. Cutting expenses part 1: utilities


6. How bad of a deal is a 50 year mortgage

10 Tips for Better Money Management

1. See where you’re spending. Start your plan by writing down where you spend every dollar over the next month. You may be surprised at what you’re spending money on – and how much you’re spending on certain things.


2. Make a budget. Once you know what you’re spending and where, create a written budget and stick to it. It’s the most effective way to stay within your means and curb bad spending habits. Be sure to review your expenses against your budget monthly.


3. Stick to your budget. A budget won’t do you any good if you don’t follow it religiously. Build some self-discipline, and remember why you’re on a budget in the first place.


4. Reduce what you owe. The more debt you can pay off, the less interest you will have to pay, and the more you can funnel into savings and investments for the future.


5. Start saving. A savings plan helps meet financial goals and provides security. Set aside a percentage of your monthly income as savings. Ten percent is a good target if you’re in your 20s or 30s, more if you’re older and behind in your retirement planning. Make it the first “bill” you pay by setting up an automatic investment.


6. Plan for retirement. Contribute to an IRA or participate in your company’s 401k plan. The yearly maximum you can contribute to these tax-advantaged plans changes, so check with your accountant or company plan coordinator.


7. Pay with cash. It’s one of the surest ways to stay out of debt.


8. Get paid back. Your money is doing you no good in someone else’s pocket. Keep this in mind the next time you need to collect your roommate’s share of the gas bill or that $20 you lent to a friend.


9. Protect yourself from identify theft. Receive an early warning of potentially fraudulent activities.It’s also smart to request a credit report annually


10. Keep good records. Save yourself from scrambling at tax time – and don’t miss any deductions – by organizing your financial records early in the new year. Be sure to save receipts, cancelled checks, pay stubs, bank and investment statements, and proof of any other deduction you want to claim, such as alimony, charitable contributions, or mortgage interest.

This list was gathered from paypal.com

General tips on Insurance

Most of us pay our automobile and homeowners insurance premiums by habit, rarely if ever making comparisons. With many families insurance costs totaling over $2000 a year, even a 15% savings equates to $300 annually. Some hints from the Insurance Information Institute on saving money on your homeowners insurance include:

• Be sure to shop around. It may take a little time, but it could save you money. The insurer you select should offer both a fair price and excellent service


• Raise your deductible. Deductibles on homeowners policies typically start at $250. By increasing your deductible to $500, you could save up to 12%.


• Beef up your home security. You can usually get discounts of at least 5% for a smoke detector, burglar alarm or dead-bolt locks

For automobile insurance the Insurance Information Institute recommendations include:

• Shop around. Prices for the same coverage can vary by hundreds of dollars from company to company, so it pays to shop around. Surf the net, ask your friends or call your state insurance department for ideas about companies and agents to contact.


• Ask for Higher Deductibles. By requesting higher deductibles on collision and comprehensive (fire and theft) coverage, you can lower your costs substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive cost by 15% to 30%.


• Take Advantage of Low Mileage Discounts. Some companies offer discounts to motorists who drive fewer than a predetermined number of miles a year.

Tips to make your new year happier

By Gerri Willis

A new year has arrived. So it's time to get started on that January to-do list for your home. On top tips we'll give you the tools you can use to check these chores off your list.

1. De-junk
If you found a new computer, cell phone or camera under the tree, but your pile of old gadgets keeps piling up, it's time to give the heave-ho to that e-junk.
To donate your old Mac or PC, contact the National Cristina Foundation (www.cristina.org), which has affiliates in all 50 states. To find groups in your area that are in need of donated electronics, go to sharetechnology.org.
Of course, you'll want to completely erase your hard drive when you do this. There are a number of software programs you can use to do this, like McAfee's QuickClean program for about $24.00 or Acronis' Drive Cleanser.
If you just want to recycle some ink jet cartridges or cell phone batteries, check some retailers in the area. Often places like Best Buy or Circuit City will have recycle drop-off areas.

2. Check your insurance coverage
The new year is a perfect time to check your flood insurance coverage. If your area is prone to flooding, you'll want to get insurance. Contact the National Flood Insurance Program at (888) 379-9531 or www.floodsmart.gov.
Remember, it won't cover everything. In fact, you'll pay $400 to $500 for only about $250,000 worth of coverage. Floods aren't the only reason you might need to buy more insurance protection.
Home values have risen over 50% over the past few years. That means you'll need more insurance for your home in case it needs to be rebuilt. To get a grip on how much coverage you need, get a contractor to estimate the cost of rebuilding your house using materials at today's costs.
Oh, and while you're at it, snap a few photos inside your home. That may prove more valuable than you think when it comes to making insurance claims.

3. Call a handyman
If fixing that leaky faucet or finally patching that hole in the wall is something you want to tackle in the new year, you may want to consider hiring a handyman.
While word of mouth is still a pretty safe bet, here are some places you may want to check out: Handymanconnection.com, servicemagic.com and homefixology.com.
To get some reviews from customers, check out sites like Angies list where people report their customer experience with handymen and other areas of home improvement.
Keep in mind there is a monthly membership fee. Generally you'll want to interview at least three handymen for the job and of course, you should get references.

4. Trim your payments
If you pay private mortgage insurance because you didn't put down 20 percent when you bought your house, now is the time to take a close look at what you're paying. If you took out your mortgage after July 1998, and you've paid off about 22 percent of the loan, your lender must cancel your PMI.
Any gain in your home's value from appreciation may help you get rid of PMI. You'll have to prove to your lender that the value of your home - including price gains - has increased enough to let you off the hook for PMI.
This annoying burden can be up to $50 a month for every $100,000 worth of debt. A word of caution though...before you spend about $300 bucks for an appraiser to find out how much your home's value has risen, understand under exactly what terms PMI can be waived. Individual mortgage terms can vary.

Why you should use google

Here are some benefits of using google's search engine.

1. Your search covers billions of URLs.Google's index, comprised of billions of URLs, is the first of its kind and represents the most comprehensive collection of the most useful web pages on the Internet. While index size alone is not the key determinant of quality results, it has an obvious effect on the likelihood of a relevant result being returned.


2. You'll see only pages that are relevant to the terms you type. Google only produces results that match all of your search terms or, through use of a proprietary technology, results that match very close variations of the words you've entered (e.g., if you enter "comic book", we may return results for "comic books" as well). The search terms or their variants must appear in the text of the page or in the text of the links pointing to the page. This spares you the frustration of viewing a multitude of results that have nothing to do with what you're looking to find.


3. The position of your search terms is treated with respect. Google analyzes the proximity of your search terms within the page. Google prioritizes results according to how closely your individual search terms appear and favors results that have your search terms near each other. Because of this, the result is much more likely to be relevant to your query.


4. You see what you're getting before you click. Instead of web page summaries that never change, Google shows an excerpt (or "snippet") of the text that matches your query -- with your search terms in boldface -- right in the search results. This sneak preview gives you a good idea if a page is going to be relevant before you visit it.


5. You can feel lucky and save time doing it. Google excels at producing extremely relevant results, and flat out nails many queries such as company names. We're so confident, in fact, that we've installed an "I'm Feeling Lucky" button, which takes you directly to the site of the highest ranked result in your search. Try it and let us know if our confidence is justified.


6. You can get it, even when it's gone. As Google crawls the web, it takes a snapshot of each page and analyzes it to determine the page's relevance. You can access these cached pages if the original page is temporarily unavailable due to Internet congestion or server problems. Though the information on cached pages is frequently not the most recent version of a site, it usually contains useful information. Plus, your search terms will be highlighted in color on the cached page, making it easy to find the section of the page relevant to your query.

Six Ways to Save on Auto Insurance

The Insurance Information Institute (III) reports a mere 0.5% increase for 2006, bringing average annual costs to $867. This marks the smallest increase in five years.




But just because prices aren't breaking the speed limit doesn't mean you should be complacent about costs. With a few relatively painless steps, you can probably find yourself a cheaper policy. Here are six ways to save:

1. Shop Around


2. Get All Available Discounts


3. Increase Your Deductible


4. Drop Some Coverage


5. Clean Up Your Credit Report


6. Get the Right Car

10 tips for stress-free shopping

I found this article on money.scotsman.com and its got nice tips on stress free shopping so I figured I post it here for my readers to read. I think since it's the holidays, many people could use these tips

1. Start sooner rather than later to avoid panic-buying.


2. If you're struggling for ideas, ask the people you are going to buy for what they would like.


3. If you want the gift to be a surprise, ask other friends or family members for tips.


4. Don't wander around the shops aimlessly - write a shopping list.
   
5. Do as much shopping as you can online.
   
6. If you don't want to buy expensive items online or want to see them first, use the net for research. This will give you an indication of how much you can expect to pay for items.
   
7. Consider taking a day off work rather than struggling with the weekend crowds.


8. Ask for a gift receipt (which does not show the price) - if your gift doesn't hit the spot, your recipient can exchange it easily, without embarrassment.


9. If you're worried about how much you might spend, leave your credit cards at home.
   
10. Treat your friends or family to dinner or an evening at the theatre instead. No shopping
    required and you both get a treat.

How to negotiate a pay raise

It can be really tough when it comes time for asking for that raise. But there comes a time when it makes sense to say to your manager, "I believe I am worth more to this company than what I am being paid. I would appreciate a raise."

Keep in mind that managers need more than a string of "really"s to make an effective argument for granting a raise. "I really, really, really need more money," will really, really, really fail in most cases. You want to never try to make a case for a raise on the basis of need. Organizations can stay in business only by paying people what they contribute to the bottom line, not their needs.


Things to do before you talk to your manager about the raise:

• You want to start preparing by first researching salary levels.
• Focus on your accomplishments, your commitment and the value you add to the company.
• Ask for a one-on-one meeting and be confident about your proposal for an increase that reflects both your contribution and the company's considerable growth
  

Things to do while talking to your manager about the raise.

• Bring along a copy of your performance review if it will help your case. If it's not a great review, be prepared to show how you've shown improvement.
• Provide hard copies of positive e-mails you've received from your supervisor, other employees or customers.
• Provide a list of major assignments that you've gotten good feedback on.
• Use a salary calculator to see how much people who share your job title and location are making
• Have some idea about how your role feeds into the bottom line. Do you attract customers, who in turn spend money? Do you support teams that generate revenue for the company? Do you constantly look for ways to save the company money?
• Avoid issuing an ultimatum unless you're prepared to stand by it. Employees will often say, in so many words, that either they get a raise or they will quit. If you're just bluffing, be prepared for your supervisor to call your bluff. It happens more often than you might think

How credit scores are calculated

You can definitely get lenders attention by filing for bankruptcy but the small things can also have just as big of an impact on your credit score. Here are 5 areas in which credit lenders look to judge your credit score:

1. 1. Past payment history-Your payment punctuality weighs heavily (about 35%) on your credit score.On the flip side, by paying your bills consistently on time, you can greatly improve your overall score.


2. Amounts owed- Add up all of your outstanding balances and compare the number to the amount of credit that is available to you. If you are reaching or exceeding your credit limits (perhaps you've heard the term "maxing out"?), lenders will get antsy.


3. Length of credit history-Fifteen percent of your credit score is determined by how long you've been using credit.Obviously, the longer your credit history, the more favorable lenders will see you. Your score in this area also takes into account how long it has been since you used certain accounts


4. Amount of new credit-Each time you apply for new credit, an inquiry shows up on your report. Red flags start waving when you take on more credit -- or even just apply for new credit in a short period of time.


5. Types of credit-Types of credit include credit cards, retail accounts, and installment loans (like car loans and mortgages). Your use or over-use of these has a 10% impact on your overall score.

Surprising 6 figure jobs

Want to make six figures? Here is a fun list of 6 figure jobs that I think are reasonable.

• Court Reporter- If you got the skills to type 200+ words a minute, then this is your job. Special skills like this is always in demand
  
  
• Professional Coach - About 20% of 10,000 coaches make six figures, according to industry estimates.
  
  
• Mine Manager - Claustrophobia aside, this profession has a median of 106,000 dollars a year for those with the project management skills.
  
  
• Sales person - Also know as the world's easiest high paying job for some, and the toughest low paying job for others. If you have a way with people, then this job is for you.
  
  
• Truck Drivers - These long haul truck drivers whose willing to be on the road for weeks can pull over 100,000 dollars plus benefits.
  
  
• Tech Writer - For those who understand high-tech issues, with the ability to write about them in way that makes them understandable to the masses, this job could be for you.
  
  
• Restaurant Managers - If you able to work your way up from a kitchen staff or a waiter to a store manager, you could be making six figures.
  
  
• Air Traffic Controllers - If you can manage the stress and then your looking at starting around 100,000.
  
  
• Elementary Principle - The national median is said to be 76,000 a year but if you live in those higher income areas with large enrollment
  

Ideas to keep in mind to prepare for 2007

We all know that 2007 is just around the corner so lets start preparing for the new year. Here are some things to keep in mind for this new up coming year and things you should consider.

1. Stop driving so recklessly. To save at the pump, be smart at the wheel. For every pound per square inch your tires are under-inflated, you cut mileage by 1% to 2%. Save up to 30% by replacing dirty spark plugs and air filters. Accelerating and braking quickly lowers your highway gas mileage by 33%. At home, plug leaks. Install a programmable thermostat and shave 10% off your bill.


2. It's a buyer's market. Drive a hard bargain. Real estate in 2006 turned a corner - and not a good one. In the past year, home prices have dropped 2.2%. In this kind of a market, once you've found the house you want, start the bidding at least 15% below the asking price. Barry Miller, a broker and owner of Denver-based Buyers Only America Realty, says that's the average discount his clients are getting.


3. Invest your tax refund for retirement, automatically. Starting with your 2006 tax return, you'll be able to directly deposit your refund in an IRA. Yield not to the temptation of spending your refund - just get yield.


4. Vanguard Growth Index.Blue-chip growth companies have returned only three-quarters as much as the S&P 500 this year and even less of the Dow's gains. And they're still at least 20% below their normal valuations, as measured by their price-to-earnings ratios.

When will you be a millionaire?

It seems that everyone is trying to climb that millionaire ladder of success, that includes me. My goal is to get there by the early 40's. Think its reasonable? I certainly do, heres my plans/situations and what defereniate me from the rest.

• I am currently in school and will have absolutely no loans after Im done. In fact, I am currently getting paid to go to school.


• I will have a steady income of 50k+ a year after graduation, which is a nice start.


• The company that I work for will pay for my masters and in returns will also give me a nice raise.


• My plans to own my home by the age of 25 will help me by not dumping my money away to pay for rent. The monthly mortage will be going towards my house.


• I have plans for investing in real estate and expect to own a few houses by mid 30's, where I will be renting out to people for monthly income.


• I intend on putting away most of my checks in index funds.


• I have a great start just because I started to save/invest at such an early age.


• I think long term and have already started planning out my budget for my first home.

These are just some cases and plans I currently have. Here is a site that calculates when your gonna hit your million mark. After putting in my data, my results came out to be 20 years and 6 months. Have fun.

Smart ways to save money in a divorce

I read a story from msnbc about how to save money in a divorce. Now we all know that divorces can get pretty expensive but where does all that money go? Here are some highlights from the article. Enjoy:

Down and Dirty:

"The average cost of a wedding is just under $28,000, according to Conde
Nast Bridal Group — double what it was 16 years ago. The average cost of a
divorce? "That's like asking how much a car costs," says John Crouch, a
family
law attorney who practices in Arlington, Va.

Divorce proceedings can range anywhere from several hundred to several
thousand dollars. Estimates on the average cost of a divorce in the U.S. range
from $15,000 to $30,000."

The eye opener:

"The simplest — and the cheapest — way of handling divorce proceedings is to do all the negotiating and paperwork on your own. Web sites like divorce.com, divorceonline.com and completecase.com offer an array of information and services to assist you, from state-specific legal forms to downloadable divorce kits.

If your finances are simple, you don't have any shared debt, and you and your spouse can reach an agreement on custody arrangements, this may be an attractive option, and it will generally run you between $50 and $250. "

Five rules for investing

Setting your goals is an important step when considering to start investing. You should have an investment plan which can help you develop a strategy that suits your goals and financial situations. But im gonna assume that you have already done that. So here I present to you five rule for investing:

1. Diversify


2. Keep costs down


3. Pay attention to taxes


4. Buy and hold for the long run


5. Know yourself

1.)Keep in mind that all investments involve some risk. The best thing to do is to spread the risk around by investing in a mix of stocks, bonds, and cash investments and diversifying your investments within each of those asset classes. This way if some investments are not doing so well, the other investments may help even out the ups and downs of your overall portfolio.

2.)Dont let the costs fool you into thinking that higher costs and fees means you'll get more for your money. Normally, people think that you get what you paid for but when buying mutual funds, this is not the case. Overall , higher costs and fees will reduce your total performace.

3.)After the investment costs and inflation, taxes take the biggest bite out of your return. For your taxable accounts, consider investing in:

• Municipal bonds or municipal bond funds, which are exempt from federal (and often state and local) income taxes.
• Tax-managed mutual funds, which use special strategies in seeking to reduce taxes on investment returns.
• Index funds, which tend to have lower turnover and so are less likely than actively managed funds to pass along taxable gains. (This may not always be the case for index funds that track a benchmark for a narrow market segment or industry sector.)

4.) Dont waste your time trying to figure out the picdict the martket. No one can predict the ups and downs of the market often enough to make market-timing a consistently winning strategy. Just be patient and hold your ground.

5.) Know what you are comfortable with. If you cant sleep at night because your over-worried at the fact that the value of your investments is bounding around, then you need to build a portfolio with a more conservative mix. This way may not reach you to your goals asfast, but as least you will be more comfortable and more rested along the way.

How to create your investment plans

The concept of investing can be very intimidating at first. You ask your self, where do I start? Stocks, bonds, cash investment? In order to start, you need to set your financial goals, whether you want to save for your retirement, school education, new house or starting up your own business. To succeed as an investor, planning and discipline is a must.

First step in creating your investment plan is to know what you want to do with your money and when you'll need it.

• Check your time frame, this is important because your investments will rise and fall in value throughout the time you own them.The longer your time frame, the greater your ability to ride out the ups and downs of the markets. Because you won't need your money right away, you can more reasonably select investments whose values might fluctuate in the short term in hopes of earning greater returns over the long term.


• Consider all your goals. Ask your self how can I invest to meet my goals. Whatever your goals are, keep in mind that the sooner you start the better your off.

Understand and choose your assets. Take the time to understand the basics of each asset class and how you can spread the risks around.

• Stocks. Stock represents a share of ownership in a corporation. Stock returns are based on a company's dividends and profits and how investors assess its potential for future profits. Historically, stocks have provided the highest returns over time, but stock prices fluctuate — sometimes dramatically. Investors typically choose stocks for growth of capital, which can help them stay ahead of inflation over the long term.
  
• Bonds. Bonds are IOUs issued by governments, government agencies, and corporations. Interest-rate changes directly affect the prices and returns of bonds, but in general, bond prices fluctuate less than those of stocks. Investors typically choose bonds to receive income and to diversify stock portfolios.


• Cash investments. A cash investment is a very short-term IOU issued by a government, corporation, bank, or other financial institution. Using the interest payments from such IOUs, money market mutual funds provide income—most often, less than that provided by bond funds—while maintaining a stable price of $1 a share. Investors typically rely on this type of fund to stash money they'll need for emergencies and short-term goals.

Once you have decided what asset your comfortable, your next step is to select the right investments. Although you could build your portfolio with your own individual stocks, I recommend starting with a mutual fund.

The next thing is to know when to change your investment mix. Life changing events can alter your financial situation and give you good reasons to change your mix. If you need to make a change, you can rebalance in three ways:

• Make an exchange. If your asset allocation is dramatically out of balance, you can transfer money from one type of fund to another. If you move retirement money within your employer's plan or an IRA, you won't owe any taxes. Outside a retirement plan, however, you may incur taxable capital gains by exchanging shares. If this is the case, you may prefer to rebalance using one of the next two methods.


• Redirect your new investments. You could simply add new money to the asset class that's underrepresented in your portfolio.


• Redirect dividends and capital gains. Have your fund company invest dividends and capital gains from funds that have grown out of proportion in the funds that need a boost.

Next and final step is to take action. Once you have designed your plans, start working on it. Remember that the longer you wait, the more you miss out. Each day counts.

Thomas Edison once said "Opportunity is missed by most people because it is dressed in overalls and looks like work.".The truth is there’s no magic to investing, anyone can learn to do it with just a little effort.

5 easy steps to follow your "to do list".

Here's an idea that i came up with which basically helps me accomplish my goals, this really works for me so try it out.

My 5 easy steps, here they are:

• Step 1: Go buy some post-it note pads. You know, the ones where you can take each sheet and stick it on a wall or something. They're really cheap and you can find them anywhere.
• Step 2: Now write down your goals and or activities you want to accomplish on these note pads. For each goal, write it on a separate post-its. Make sure to not get too detailed when writing these posts. You want to keep it simple and short enough so that you can read it just by looking at it for a second or two.
• Step3: This is important, make sure that on each post-it pads you write down the expected date you want to accomplish your task, or else it will never get done.
• Step4: On each post, get a red pen and write on the bottom "$five dollars". (starting to get the idea?)
• Step5: Stick these posts where you can see them everyday. I have mines on my wall right next to where I sit when I'm on my computer.

Now your ready to start. The main idea here is this. Now you have posts on your wall (or where ever you decide to put them) and for every one you have an objective or a goal with a date in which you want to accomplish your task. Basically how it works is this, if you cannot accomplish your post within that due date, you pay the penalty fee, which is written on each of these posts. You can set the amount to whatever you want whether it be 2 dollars or 10 per post, just don't cheat yourself.

Look at it like this, think of these posts as price tags. For each of these tasks/goals you cannot accomplish, you have to pay x dollars. Now you ask "where does this money go?". That's the great part about this, they all go into the "savings stash" or your "savings account" or where ever, it doesn't matter as long as your saving it. So now, you will try harder to get these goals/objectives done because not only do you see them everyday but it has a price tag on it! Isn't that great? When i look at my post, it makes me want to get things done because i don't want to pay that red fine.

It can't get any better than this. You either get your "things to do" accomplished, or you have to put money away for savings. Regardless, your helping your self achieve more by supporting each cause. You just gotta love how this works, does it get any easier?

Retirement, start a 401(k) plan!

Most people have questions regarding 401k plan, many wonders how it works, what it is or how you can revive the dwindling balance in your 401k.

The 401(k) plan is a type of employer-sponsored retirement plan named after a section of the United States Internal Revenue Code. A 401(k) plan allows a worker to save for retirement while deferring income taxes on the saved money or earnings until withdrawal.

If your company offers a 401k retirement plan, which most companies now do, then you are given the opportunity to start investing towards your retirement. Your company will provide you with a list of funds they use for the plans that they offer and gives you the choice of which to invest in and also the percentage of how much you can invest.

Now, all you need know is how to get started. Contributing to a 401k plan is like investing in a car, it can be very useful as long as you don't crash.

First off, you need to figure out how much you're allowed to put in your 401k each year. When you find out how much your able to put in, you need to max it out each year if possible. Especially if you're just now starting to plan for retirement and you have less then 20 years, you're gonna have to put more away then someone who still has more than 35 years left. Either situation, you should still try to put in as much as your allowed.

Then, find out if your employer offers any kinds of matching contribution. The typical employer will match 50% of what you put in, so 50 cents to the dollar, which is a sweet deal.

Overall you want to start asap. Starting early will give you a huge lead than someone starting later on.

So the major benefits of 401k plans:

• Dollar-Cost Averaging - 401k plans are invested at regular intervals by payroll deduction. This helps force you to save, and it smooths out the bumps inherent in any futile attempt to time the stock market.


• Employer Matching - Most, but not all, employers will match a certain percentage of the funds that you contribute. This is free money!


• Tax Benefits - 401k plans allow individuals to invest up to the current federal limit (last time I checked it was $10,000 per year), and the interest earned is tax-deferred and continues to grow until you retire.


• Compound Interest - Start saving just a little bit each and every month and you can build a size-able fortune over time. Check here for an interesting story about Rick and Harper.

401k plans are very popular and an excellent way to plan for your retirement. Keep in mind as with any other investment, you still need to carefully watch your portfolio and make wise investment choices.